Roche secures US court injunction for its Ventana bid

Mumbai: Swiss drugmaker Roche Holding AG said a US court has granted it a preliminary injunction against use of state law to obstruct its bid to take over Arizona-based medical test maker Ventana Medical Systems Inc. (See: Roche goes to court over Ventana's poison-pill defence)

The Arizona federal judge issued a preliminary injunction on August 21 that barred Ventana from using a 20-year-old Arizona law to shield itself from a hostile takeover bid from Roche AG. The judge held that as a Delaware corporation, Ventana would not have recourse to the Arizona anti-takeover law, even though the target is headquartered in Phoenix.

The Swiss diagnostic giant made a $3 billion unsolicited offer for Ventana on June 26, but Ventana has steadfastly refused to come to the bargaining table, even though Roche's $75 per share cash offer represents a 45 per cent premium to Ventana's June 25 close. (See: Roche makes hostile offer for Ventana) Ventana, however, rejected Roche's offer and CEO Christopher Gleeson had advised investors against selling at that price.

"We remain steadfast in our position that Roche's offer is wholly inadequate and our board of directors continues to recommend that stockholders not tender any of their shares to Roche. Roche's offer remains significantly below our current stock price," Ventana said.

The company has had trouble generating interest in its offer. By the close of business of August 22, about 13,430 shares had been tendered - a tiny fraction of the 34 million outstanding shares of Ventana.